Investment fuels winery growth
Jakub Lipinski’s father Andrzej didn’t know anything about wine when he brought his family to Canada from Poland, decades ago.
Andrzej, who was working as a mechanic back then, “never really had any involvement in wine, whatsoever,” Jakub said.
But shortly after arriving in Niagara about 20 years ago, he said, Andrzej was hired at Vineland Estates Winery and started a new career that included making wine for several Niagara vintners in the years that followed.
“In 2011, it was time for us to start out on our own,” Jakub said.
Although the family had the expertise and equipment they needed, they didn’t have the land or a licence to become a full-fledged winery. Instead, he said, the family established a “virtual winery,” building a facility on property owned by another vintner and operating under that company’s licence.
“There was an empty patch of dirt behind that winery, and we said, ‘Listen, we’re going to build a building behind you and pay for everything,” he said. “You can use our equipment so it was mutually beneficial, and once we’re done with the building a couple of years down the line, it’s yours free and clear.”
It gave the Lipinski family the opportunity to “learn the ins and outs of running a business,” while minimizing the risks associated with the business venture.
Jakub was living in Banff at the time, running a restaurant when his father called him to tell him about his business plans.
“He said, ‘We’re going to have a winery and you’re coming home to run it.’”
Jakub was eager to get involved, although he immediately disagreed with his father about one key aspect of the new business — its name.
“He wanted to call it Lipinski’s after our family name, but I said, ‘Nope, I don’t think that will work,’” Jakub said. “Lipinski is like the Smith of Poland, and I don’t think of Polish people when I think of wine.”
He offered his father an alternative — Big Head Wines.
“Growing up I used to get teased; so did my father,” he recalled.
“I mean, Polish people are said to have big heads,” he added, laughing. “I thought Big Head would be a lot easier to market than Lipinski. It pokes fun at the Polish ego as well. There are a lot of different things.”
Andrzej wasn’t a fan of the idea at first, but did warm up to it.
Jakub said his father asked everyone what they thought about the name, and “everybody loved it,” Jakub said. “And here we are.” In the years since, things have changed big time for Big Head Wines.
Back then, the family business employed five people — and most of them were members of the family — producing its first three barrels or about 75 cases of chandon blanc.
Now, 18 people work there, and the winery has grown to include 22 types of wine among the 16,000 cases of wine it produced last year.
It’s also no longer a “virtual winery,” after outgrowing that original building in the backyard of another vintner and moving into its own facility at 304 Hunter Rd., Niagaraon-the-Lake.
Jakub attributes much of that success to the assistance the family received from the Business Development Bank of Canada (BDC).
“Being a small winery where we don’t have a lot of capital to help us with certain things, and helping us purchase equipment, that was very important to us,” Jakub said. “We’ve been walking on a wire for these last three or four years, trying to make sure we keep afloat. … And they helped us in a very crucial time that we needed it.”
BDC’s president Michael Denham said the Lipinski family is one of about 350 clients served by the organization’s Niagara offices, and 49,000 businesses from across Canada — up 17 per cent from 2016.
He said Big Head came to the BDC with “a great management team, lots of ambition, and lots of good plans to adapt from a virtual winery to bricks and mortar, and they needed the financing to build up their working capital.”
And as “the only financial institution in the country that focuses exclusively on entrepreneurs,” Denham said the BDC was eager to help.
“Big Head is a great example of a company that had lots of potential, lots of growth possibility, worked with us and we provided the financing, and now they’re growing,” Denham said. “It’s a classic example of a company in your area that’s expanding, and they’ve been able to expand successfully through its relationship with us.”
Denham said there are several reasons for the increasing number of businesses using BDC services.
“First and most important, Canadian entrepreneurs still want to grow and want to improve their businesses. The demand for their projects fuels the demand for what we provide,” he said.
“Second, we have been quite deliberate in terms of increasing our physical presence to be closer to entrepreneurs. Across the country, we’ve increased the number of business centres we have by about 20 to 120.”
Denham said the BDC has also incorporated new technology to make it easier for entrepreneurs to access its services, adding automated processes to allow BDC representatives to authorize loans remotely “while sitting in a client’s office.”
Meanwhile, new services and focuses have also been introduced, such as increased investment in technology industries, as well as businesses that are owned and operated by women.
“We’re in the middle of some fairly extensive research to really understand the situation around access to lending by women entrepreneurs,” he said. “Stay tuned on that one.”
Jakub hopes to see his family’s winery continue to grow in years to come.
“Niagara as a region … is booming,” Jakub said. “Everything has increase dramatically. In the last two years, the demand and traffic flow has increased a lot.”
Although Big Head remains a relatively new and “hidden away” part of Niagara’s wine industry, the small vintner is benefiting from the growing interest in the region and the beverage it has become known for producing.
“I think our growth will continue to rise, maybe a little slower – not as extreme as it’s been in the past – just so we can keep our hands on the reigns,” he said. “I think the entire wine industry is going to grow, and I would like to be very much a part of that growth.”
Niagara as a region … is booming. Everything has increase dramatically. In the last two years, the demand and traffic flow has increased a lot.” Jakub Lipinski